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Advance Payments: DGT doctrinal evolution

How the DGT's position on this topic has evolved, and the rulings it rests on.

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How the DGT's position has evolved

Settled doctrine High confidence 68 rulings · 2014–2026

Current position

VAT is accrued at the time of total or partial collection of the amounts actually received in advance payments. In the provision of services, such as renovations where the contribution of materials is less than 40%, the contractor must issue and deliver an invoice for each payment received before the work is carried out. The recipient of the invoice must be the party legally obligated to pay and not the person making the actual payment.

The DGT's position remains constant regarding the accrual of VAT at the time of collection of advance amounts. Rulings have progressively clarified the scope of application, ranging from the rectification of tax amounts in contract resolutions to the obligation to invoice in renovation services. No change in criterion is observed, but rather a systematic application of the rule of accrual upon collection.

Turning points

  1. V0608-15

    Establishes that the applicable tax rate is the one in force at the time of accrual (collection) and not that of the final delivery, avoiding the rectification of tax amounts due to a change in rate.

  2. V0147-21

    Clarifies that the recipient of the invoice must be the party legally obligated to pay and not the person making the actual payment.

Analysis based on 66 of 68 rulings with a stated position. Updated 23 September 2026.

Rulings on this topic

24
V1906-23 3 Jul 2023

Reduced 4% VAT rate applicable to housing deliveries to rental entities

SG de Impuestos sobre el Consumo
tipo impositivo reducidorégimen especial de arrendamientodevengopagos anticipadosvalor normal de mercado LIVA — Ley 37/1992 del IVA art. 4.unoLIVA — Ley 37/1992 del IVA art. 5.uno
Affects CompanyExpat · Non-residentIndividual
V1086-23 28 Apr 2023

The tax on non-reusable plastic packaging accrues at the time of collection of advance payments

SG de Impuestos Especiales y de Tributos sobre el Comercio Exterior y sobre el Medio Ambiente
devengoenvases de plástico no reutilizablespagos anticipadoshecho imponiblefabricación Ley 7/2022, de 8 de abril, de residuos y suelos contaminados para una economía circularLGT — Ley 58/2003 General Tributaria art. 32
Affects CompanyExpat · Non-residentIndividual
V0086-22 20 Jan 2022

Contributions to cover non-housing costs are not subject to VAT

SG de Impuestos sobre el Consumo
aportaciones al capital socialpagos anticipadosvivienda de protección públicasujeción al impuestocontraprestación LIVA — Ley 37/1992 del IVA art. 4LIVA — Ley 37/1992 del IVA art. 5
Affects CompanyExpat · Non-residentIndividual
V2526-21 8 Oct 2021

VAT paid on advance payments for investment goods is deductible

SG de Impuestos sobre el Consumo
pagos anticipadosbienes de inversióndevengoderecho a la deducciónfactura rectificativa LIVA — Ley 37/1992 del IVA art. 4.1LIVA — Ley 37/1992 del IVA art. 5.1
Affects CompanyExpat · Non-residentIndividual

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